eSalt is the biggest producer of sodium hydroxide in India. This main product of the company has a strong reactivity with other organic compounds.…

eSalt is the biggest producer of sodium hydroxide in India. This main product of the company has a strong reactivity with other organic compounds. It is highly versatile and is alkaline in nature. However, the basic material required for the production of this product is salt along with the electricity. The manufacturing process involve electrolysis which produces Halogen as co-product. Modern use of Halogen is widespread. However, the common use is in disinfection like for purifying drinking water or swimming pool water. It is also an important ingredient of toothpaste. Thus, the company's management affirmed the simultaneous production of Halogen. During the previous financial year, the company purchased the base material of 5,34,000. For the current year, company decided to increase the production by 2 times. Due to increased production, the total conversion cost hiked to 3 times. Last year, the conversion cost accounted to 8,01,000 up to the point at which two products i.e. sodium hydroxide and Halogen are separated. The production and sales information for current year is provided as below: Sodium hydroxide Halogen Production/ Sales(in tonne) 24,030 16,020 Selling price per tonne (₹) 100 150 During the current year, the management of the company pointed the extensive use of Vinyl which can be produced by further processing Halogen. Having selling price of 250 per tonne higher than that of the Halogen, it was decided not to sell Halogen and further process it into Vinyl. The incremental processing cost took - 8,01,000 producing 10,012.50 tonnes of Vinyl. You are required to FIGURE OUT the following for managerial decision (MCQs 6 to 10):